provided by Research Papers in Economics
Issues in Nonmarket Valuation and
Policy Application: A
Retrospective Glance
Richard G. Walsh, Donn M. Johnson, and John R. McKeah
While issues in estimating nonmarket values continue to cause concern, resource
economists have more reason now than ever before to be optimistic. More progress
toward improved measurement has been made in the past six years than in the
previous quarter century since development of the contingent valuation and travel
cost methods. The new challenge is to Ieam how to adjust past studies to estimate
nonmarket values for future policy analysis. The process involves developing an
understanding of the important variables that explain the observed difference in
estimates. This paper illustrates how the results thus far could be adjusted to develop
some tentative estimates of the recreation-use value of Forest Service resources.
Key words: contingent valuation method, information transfer, outdoor recreation,
travel cost method.
In the past, most studies of the nonmarket
value of natural resource use for outdoor rec-
reation focused on questions of management
at a specific location. Although there is a grow-
ing body of findings from such studies, the
increased demand for research results has far
outpaced supply constrained by reduced bud-
gets offunding agencies (President’s Commis-
sion on Americans Outdoors). As a result, some
observers have begun to question whether past
studies can be applied to future resource policy
decisions. Could the present stock of studies
have a dual purpose with a direct use in policy
application at the study site and an indirect
use to answer policy questions at other times
and places?
If the existing studies produce the same set
of findings, then an agency could with confi-
dence predict the benefit of recreation activi-
ties at new or expanded sites. However, if the
studies produce widely varying results for
The authors are, respectively, professor, graduate research assis-
tant, and professor, Department OfAgricultural and Resource Eco-
nomics, Colorado State University.
The study was funded, in part, by Purchase Order No. 43-82FT-
7-1253, Rocky Mountain Forest and Range Experiment Station,
Forest Service, U.S. Department of Agriculture, Fort Collins, and
by the Colorado Agricultural Experiment Station, Western Re-
gional Project W-133, Benefits and Costs in Resource Planning.
We are grateful for the assistance of K. H. John and helpful
comments by O. Bergland, J. E. Keith, and V. K. Smith. Errors
and omissions are, of course, the sole responsibility of the authors.
unexplained reasons, an agency could not eas-
ily predict the value of recreation based on the
available literature. Adjustments would have
to be made to facilitate the transfer of findings
from the locations where studies were per-
formed to areas where they were not. Even
where studies were conducted, improved data
transfer procedures could increase the preci-
sion of future net benefit estimates.
For this purpose, there is a need for research
to develop an understanding of the variables
that explain the observed difference in esti-
mates. This paper follows standard procedures
developed by metaanalysis, the growing sci-
ence of reviewing research (Cooper; Light and
Pillemer). The approach introduces precision
into the analysis with respect to specific pur-
pose of the literature review; the selection of
the studies for review; the similarity of the
units of analysis and subject matter across
studies; the distribution of study values; and
the relationship of study values to research
design, characteristics of participants, quality
of the sites, and management programs.
Updated and Adjusted Benefits
The source of data for this paper is the liter-
ature on demand for outdoor recreation with
WesternjournalofAgriculturalEconomics, 14(1): 178-188
Copyright 1989 Western Agricultural Economics Association